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HomeBusinessEconomyHaiti’s second review under the staff-monitored program

Haiti’s second review under the staff-monitored program

By Caribbean News Global fav

USA / HAITI – The executive summary follows the International Monitory Fund (IMF) management’s second review of the staff monitored-program with Haiti.

IMF management completes the second review of the staff monitored-program with Haiti

Context

Haiti faces a challenging macroeconomic outlook amid a humanitarian crisis. The country has been hit hard by economic spillovers from Russia’s invasion of Ukraine, with food price inflation triggering a hunger crisis.

This global shock has been compounded by a dire security situation, which has heightened the economy’s fragility, hampered activity, and generated supply-side bottlenecks which have further fueled inflation. Risks to the outlook are tilted to the downside.

Program implementation

The implementation under the SMP has been broadly satisfactory. Despite domestic and global difficulties, the authorities have adopted important policy reforms, anchored by the SMP, and displayed a firm commitment throughout. The reforms cover governance and anti-corruption, tax and revenue administration, public finance management, including budget preparation and execution, and central bank independence. Data has also improved. All these have enhanced much-needed transparency in public spending and in the financial sector and helped maintain macroeconomic stability.

Despite the delicate political landscape, and thanks to a highly inclusive consultative process, the authorities have taken the necessary ownership and earned public support for the SMP through the high-level Program Monitoring Committee (Comité de Suivi). The authorities met three of the four end-December 2022 periodic quantitative targets (QTs) and the indicative targets (IT) for end-December.

They missed the end-December QT floor on budget allocation to the Ministry of Social Affairs and Labor (MAST) for social expenditure. The authorities also met four of the five ITs for end-March 2023 and missed by a narrow margin the IT floor on central government revenues, which was revised up at the time of the first review. The authorities also met the three continuous QTs non-accumulation of both domestic and external arrears and no new contracting or guaranteeing by the public sector of non-concessional external debt. Despite some delays, all structural benchmarks were achieved. The two end-March 2023 structural benchmarks were not met but implemented with delay in April. The end-April 2023 structural benchmark and the monthly and quarterly structural benchmarks were all met.

Next steps

The authorities have expressed interest in another SMP, which should help lock in and sustain recent approved reforms to further enhance economic resilience and governance. The new SMP will continue to be supported by Fund capacity development assistance. In line with the Fund Strategy for Fragile and Conflict-Affected States, staff will also continue to coordinate closely with Haiti’s main development partners.

The full report is available here.

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